Carbon Design Systems: a strategic investment from Samsung

Samsung Venture Investment Corp. has just put $4 million into Carbon Design Systems in conjunction with the debut of a new strategic partnership between the two companies.

Per the September 12th Press Release: “Funds from the strategic investment will be used as working capital and will support Carbon’s ongoing development of leading tools in the ESL design space, including its fast, accurate virtual prototypes. Initiatives will be undertaken to expand the reach of Carbon’s fast, accurate virtual prototypes.”

I spoke with Bill Neifert, Carbon’s founder, CTO and VP of Business Development on the day of the announcement. He was amazingly relaxed, a clear indication that the Samsung-Carbon partnership is a logical outcome of a long-term relationship between the organizations:

“Samsung been a heavy user of our tools for quite some time, and has been looking for ways to take even more advantage of that situation – to speed up product introductions, something that everyone’s trying to do in that marketplace.

“Today’s announcement is part of a Samsung initiative to advance their SoC design methodologies. They have both the resources and expertise today to innovate and are looking to us to help them with that. This is also a nice partnership for us, of course. It will help us share our methodology in a broader fashion.”

I asked if Samsung’s investment will jettison Carbon into an even better market position.

Bill said, “Yes, but this is a true partnership. It’s not just about money for Carbon, but about having additional access to Samsung’s time, expertise, and technology. Samsung wants to make better products, and enhancing our technology will also expand their customer base.”

He added, “Samsung is not dictating how we use the money, but as in any partnership, we are working on several initiatives with them.”

Wouldn’t Samsung have better control if they just bought Carbon outright?

Bill chuckled: “Thankfully, the company is worth more than just $4 million, and we are not in a position where we need to be bought. Moreover, that’s not the idea. We’re an EDA company, and it’s often the case that semiconductor companies invest in the tool companies to make sure they have access to the methodologies they need.”

Does Carbon partners with any one of the Big Three EDA companies in particular, and if so does Samsung get additional leverage through this investment? Bill said, “That’s an interesting question, and depends on how your define ‘partnering.’

“If you look at the least amount of competitive overlap and the most amount of market synergy, it would seem that Cadence is the name you’re looking for. We’ve had a longstanding IP partnership centered around their memory controllers which dates back to the Denali days.

“Synopsys, on the other hand, has offerings in some areas which are competitive with us, although their tools do not provide the accuracy we offer. Mentor has been taking more of an embedded angle, with less emphasis on the whole SoC model. I’m not saying they don’t play in our space, but they’re not focusing on it.

“Nonetheless, it would be an incorrect conclusion to see Samsung’s investment in Carbon as an investment in Cadence. Samsung gets a lot more leverage – a lot more bang for their buck – from putting money into a small company like ours than they would with similar amounts invested in any of the Big Three. We don’t have as much overhead, and we are singularly focused on the Virtual Prototyping area.

“We provide an infrastructure the large EDA companies simply don’t have, part of the reason being our modeling partnership with leading IP companies. If you want to advance your methodology for ARM-based SoCs, Carbon’s technology is a great place to put an investment.”

I asked Bill to lay out various ways Carbon will be using their newly announced influx of cash.

He said, “If you look at what Carbon does uniquely, it’s our tie-down to accuracy. The ability of our tools to go seamless from 100-percent accurate models to prototypes running at 100 MIPS. This ability to run faster while remaining cycle-accurate, make it easier to support multiple SoC developments at the same time, and greatly expands the value of our products. We will use the cash to build on these unique strengths.

“Samsung will benefit because they’ll be helping to guide us in this work. They have a dialog with our engineering organization, who will work with Samsung’s developers to keep apace of their needs. And the overall ecosystem will benefit because Samsung is well known for using IP from ARM and other leading IP vendors, many of whom are also Carbon’s IP partners. As we advance our methodology, all of these companies will benefit, not just Samsung.”

If these are the beneficiaries, who is Carbon’s competition? Bill said, “The competition remains those people who have not adopted Virtual Prototyping, those people who still do design the old-fashioned way – in separate teams segregated between the architectural hardware and the software designers. Even today, that continues to be our fundamental competition far more than any companies in EDA.”

I asked Bill if he could have predicted 5 years ago that Samsung would be making this investment in Carbon, and where will Carbon be 5 years from now.

He said, “Samsung has been one of our major customers for a long time. We’ve had white papers outlining their successes with out tools, starting when we purchased our Virtual Prototyping technology from ARM. A deeper partnership to further drive innovation is a very positive step in the evolution of that relationship.

“The future, of course, is a lot harder to predict. Certainly for the next several years, we’ll continue to focus on the Virtual Prototyping space, expanding on what we do there to achieve additional tie-ins to accuracy.

“We know very well that the biggest problem is small companies is trying to be too many things to too many people. There will continue to be more than sufficient market space for us to explore building on our current technology.”

When you say “I asked if Samsung’s investment will jettison Carbon into an even better market position.” ? I think you mean propel not jettison. Jettison normally means to throw something overboard, e.g. “a voluntary sacrifice of cargo to lighten a ship’s load in time of distress.”

Thanks, Sean — it can also mean to throw through the air with no knowledge of where things will land. Very nice usage w.r.t. this infusion of cash; now it’s up to Carbon to define the trajectory initiated by Samsung’s investment. No doubt they’re up to the challenge!